DEF 14A of Natera, Inc., Apr 24, 2024

DEF 14A of Natera, Inc.

Filed Apr 24, 2024 · FY20230001558370-24-005619

Open on EDGAR

  1. Our Board of Directors

    Our Board of Directors The following is an overview of our Board of Directors as of April 1, 2024. Our Class III directors are each standing for re-election at our 2024 Annual Meeting. Additional information about each director can be found starting on page 8 of this proxy.

  2. Our Board of Directors

    | Name | Class | Age | Director Since | Independent | Committee Membership | | | Other Public Company Boards | | | | | | | AC | CC | NCGCC | | | Roy Baynes Director | I | 69 | 2018 | | | | M | 1 | | Roelof F. Botha Lead Independent Director | III | 50 | 2007 | | | | M | 4 | | Rowan Chapman Director | II | 53 | 2019 | | M | C | | - | | Steven Chapman Chief Executive Officer and Director | III | 45 | 2019 | | | | | - | | James I. Healy Director | I | 59 | 2014 | | M | M | | 3 | | Gail Marcus Director | I | 67 | 2017 | | M* | | C | - | | Matthew Rabinowitz Co-Founder and Executive Chairman of the Board | III | 51 | 2005 | | | | | - | | Herm Rosenman Director | II | 76 | 2017 | | C* | M | | 1 | | Jonathan Sheena Co-Founder and Director | II | 51 | 2007 | | | | | - | | Ruth Williams-Brinkley Director | I | 72 | 2023 | | | M | | 1 |

  3. Our Board of Directors

    | AC Audit Committee | CC Compensation Committee | NCGCC Nominating, Corporate Governance & Compliance Committee | | M Committee Member | C Committee Chair | | | * Audit committee financial expert | | |

  4. Information Regarding the Nominees and Other Directors

    Information Regarding the Nominees and Other Directors

  5. Nominees for Class III Directors For Terms Expiring in 2027

    Nominees for Class III Directors For Terms Expiring in 2027

  6. Nominees for Class III Directors For Terms Expiring in 2027

    | 48 Since: 2007 | | | Roelof Botha | 66 Since: 2017 | | Mr. Botha has served as a member of our board of directors since 2007. Mr. Botha has been with Sequoia Capital, a venture capital firm, since 2003, and has been a managing member of Sequoia Capital Operations, LLC since 2007. From 2000 to 2003, Mr. Botha served in a number of roles at PayPal, Inc., ultimately as the chief financial officer. Mr. Botha currently serves on the board of directors of 23andme, a personal genetics company; Block, Inc. (formerly Square, Inc.), a provider of payments, financial and marketing services; MongoDB, Inc., a document-oriented database program developer; Unity, Inc., a 3D and VR content development platform; and a number of private companies. Mr. Botha has previously served on the board of directors of Bird Global, a last-mile electric vehicle sharing company, from May 2018 through December 2022; and Eventbrite, Inc., an event management and ticketing platform, from October 2009 through June 2022. Mr. Botha holds a Bachelor of Science in Actuarial Science, Economics, and Statistics from the University of Cape Town and an M.B.A. from Stanford University. Our board of directors believes that Mr. Botha is qualified to serve as a director based on his financial and managerial experience, his service on other public and private company boards of directors and his familiarity with technology companies. Mr. Botha is our Lead Independent Director and currently serves on our nominating, corporate governance and compliance committee. | Roelof Botha Lead Independent Director Age: 50 Director Since: 2007 Committees: Nominating, Corporate Governance & Compliance |

  7. Nominees for Class III Directors For Terms Expiring in 2027

    | Chief Executive Officer & President 44 Since: 2019 | | | Steven Chapman Director Chief Executive Officer & President Age: 45 Director Since: 2019 | Mr. Chapman has served as a member of our board of directors and as our Chief Executive Officer since January 2019. Mr. Chapman has been with our company since December 2010, serving as our Chief Operating Officer from July 2017 to January 2019; our Chief Commercial Officer from August 2016 to July 2017; our Senior Vice President, Commercial Operations from January 2014 to August 2016; and Vice President, Sales from December 2010 to January 2014. Prior to joining our company, Mr. Chapman worked at Genzyme Genetics Corp., a biotechnology company, from 2003 to 2010. Mr. Chapman holds a Bachelor of Science in Microbiology, Immunology and Molecular Genetics from University of California, Los Angeles. Our board of directors believes that Mr. Chapman is qualified to serve as a director based on his experience in various management and executive roles at our company and his experience in the biotechnology field. |

  8. Nominees for Class III Directors For Terms Expiring in 2027

    | | Chief Executive Officer 43 Since: 2014 | | Dr. Rabinowitz is a co-founder of our company and currently serves as our Executive Chairman. Dr. Rabinowitz served as our Chief Executive Officer from 2005 to January 2019, and has served as a member of our board of directors since 2005. He served as Chairman of our board of directors from May 2015 to January 2019, at which time he assumed the role of Executive Chairman. Prior to co-founding our company, Dr. Rabinowitz served from 2000 to 2003 as chief executive officer and from 2003 to 2007 as chief technology officer of Rosum Corporation, a location services technology company. Dr. Rabinowitz served as a consulting professor at Stanford University from 2004 to 2012 and as visiting faculty in the Genetics Department of Harvard University from 2018 to 2019. Dr. Rabinowitz has over 100 patents and publications in signal processing, machine learning, bio-informatics, and high-throughput genetic testing. He received the Scott Helt Memorial Award from the Institute of Electrical and Electronics Engineers and two companies he founded have received the Technology Pioneer Award from the World Economic Forum. He currently serves as a member of the board of directors or advisory board of a number of private technology companies. Dr. Rabinowitz holds a Bachelor of Science degree in Engineering and Physics, a Master of Science in Electrical Engineering, and a Ph.D. in Electrical Engineering, from Stanford University. Our board of directors believes that Dr. Rabinowitz is qualified to serve as a director based on his experience as our co-founder and Chief Executive Officer, his private company board experience, and his experience in the technology industry. | Matthew Rabinowitz, Ph.D Executive Chairman Co-Founder Age: 51 Director Since: 2005 |

  9. Incumbent Class II Directors With Terms Expiring in 2026

    Incumbent Class II Directors With Terms Expiring in 2026

  10. Incumbent Class II Directors With Terms Expiring in 2026

    | 51 Since: 2019 | | | Rowan Chapman, Ph.D. Director Age: 53 Director Since: 2019 Committees: Compensation (chair) Audit | Dr. Chapman joined our board of directors in August 2019. Dr. Chapman is a co-founder of and advisor to Initiate Studios, a life sciences incubator, and BEVC, an early-stage investment fund. She also served as chief business officer of Dynamics Special Purpose Corporation from March 2021 to June 2022. Prior to this, she served as head of Johnson & Johnson Innovation, Western North America, Australia and New Zealand from January 2017 to August 2019. Previously, Dr. Chapman held various roles with General Electric Company from 2012 to 2016, including as head of precision diagnostics at GE Healthcare Life Sciences, managing director of New Business Creation at GE Ventures, and head of healthcare investing at GE Ventures. Prior to that, she held operational roles in early and growth-stage startups and was a partner at Mohr Davidow Ventures for over 11 years, gaining extensive experience as a board member and board advisor for a wide variety of technology and data-enabled companies. Dr. Chapman currently serves as a member of the board of a venture capital fund as well as a number of private companies. Dr. Chapman holds a Bachelor of Arts degree in Biochemistry and a Doctor of Philosophy degree in Biochemistry and Molecular Biology from the University of Cambridge, United Kingdom. Our board of directors believes that Dr. Chapman is qualified to serve as a director based on her business development, operating and investment experience in the healthcare and biopharmaceutical industries. Dr. Chapman currently serves as the chair of our compensation committee and as a member of our audit committee. |

  11. Incumbent Class II Directors With Terms Expiring in 2026

    | | | Chief Financial Officer 74 Since: 2017 | | Mr. Rosenman has served as a member of our board of directors since February 2017, and served as our Chief Financial Officer from February 2014 to January 2017. Prior to joining our company, he held the position of senior vice president — finance and chief financial officer at Gen-Probe Incorporated, a developer, manufacturer and marketer of diagnostic and screening products using nucleic acid probes, from June 2001 to August 2012, when Gen-Probe was acquired by Hologic, Inc., a developer, manufacturer and supplier of diagnostic products, medical imaging systems, and surgical products. From April 2012 to February 2014, Mr. Rosenman focused on his board memberships. Mr. Rosenman has served on the board of directors of DermTech, a molecular dermatology company, since 2017. Mr. Rosenman also previously served on the board of directors of Oxford Immunotec Global PLC, a commercial-stage diagnostics company, from 2017 to 2021, when the company was acquired by PerkinElmer; Vivus, Inc., a biopharmaceutical company, from 2013 to 2021; as well as Medistem, Inc., a stem cell therapy company, ARYx Therapeutics Inc., a private drug discovery and development company, Infinity Pharmaceuticals, Inc., a drug discovery and development company, and a number of privately held companies. Mr. Rosenman holds a B.B.A. in Accounting and Finance from Pace University and an M.B.A. in Finance from the Wharton School of the University of Pennsylvania. Our board of directors believes that Mr. Rosenman is qualified to serve as a director based on his experience as our chief financial officer, his experience in the biopharmaceutical industry and his experience serving on the boards of directors of other companies. Mr. Rosenman currently serves as the chair of our audit committee and also serves on our compensation committee. | | Herm Rosenman Director Age: 76 Director Since: 2017 Committees: Audit (chair) Compensation | | Jonathan Sheena Director Co-Founder Age: 51 Director Since: 2007 | Mr. Sheena is a co-founder of our company, and served as our Chief Technology Officer from 2007 to December 2020. Mr. Sheena has served as a member of our board of directors since 2007. Prior to co-founding our company, Mr. Sheena co-founded PhoneSpots, Inc. (formerly PocketThis, Inc.), a mobile technology company serving mobile carriers worldwide, in 1999. Mr. Sheena held various roles at PhoneSpots, Inc. from June 1999 to December 2007, including vice president of product management and chief technology officer. Mr. Sheena holds a Bachelor of Science in Electrical Engineering and Computer Science, and a Master of Engineering in Electrical Engineering and Computer Science, from the Massachusetts Institute of Technology. Our board of directors believes that Mr. Sheena is qualified to serve as a director based on his experience as our co-founder and Chief Technology Officer, his experience with entrepreneurial companies, and his particular familiarity with technology companies. | |

  12. Incumbent Class II Directors With Terms Expiring in 2026

    | | 51 Since: 2019 | | | | | 49 Since: 2007 |

  13. Incumbent Class I Directors With Terms Expiring in 2025

    Incumbent Class I Directors With Terms Expiring in 2025

  14. Incumbent Class I Directors With Terms Expiring in 2025

    | 67 Since: 2018 | | | Dr. Baynes has served as a member of our board of directors since July 2018. Since July 2022, Dr. Baynes has served as executive vice president and chief medical officer of Eikon Therapeutics, Inc., a privately-held biotechnology company. Previously, Dr. Baynes served as senior vice president and head of global clinical development at Merck Research Laboratories, the research division of Merck and Co., Inc., beginning in 2013, and as chief medical officer of Merck and Co, Inc., a global healthcare company, beginning in 2016. Prior to joining Merck Research Laboratories, Dr. Baynes served as senior vice president of oncology, inflammation and respiratory therapeutics at Gilead Sciences Inc., a biotechnology company, from 2012 to 2013 and the vice president global development and therapeutic area head hematology oncology at Amgen Inc., a biopharmaceutical company, from 2002 to 2012. Before joining Amgen, Dr. Baynes was the Charles Martin Professor of Cancer Research at the Barbara Ann Karmanos Cancer Institute, a National Cancer Institute-designated Comprehensive Cancer Center, at Wayne State University. Dr. Baynes has served as a director of Travere Therapeutics Inc. (formerly known as Retrophin, Inc.), a biopharmaceutical company, since July 2016, and previously served as a director of Atara Biotherapeutics, Inc., a biopharmaceutical company, from September 2018 until December 2022. Dr. Baynes also serves as a director of a private biotechnology company. Dr. Baynes holds an M.D. and a Ph.D. from the University of the Witwatersrand, Johannesburg, South Africa. Our board of directors believes that Dr. Baynes is qualified to serve as a director based on his extensive experience in the biopharmaceutical industry and experience on other public company boards of directors. Dr. Baynes currently serves on our nominating, corporate governance and compliance committee. | Roy Baynes, M.D., Ph.D. Director Age: 69 Director Since: 2018 Committees: Nominating, Corporate Governance & Compliance |

  15. Incumbent Class I Directors With Terms Expiring in 2025

    | 65 Since: 2011 | | | James Healy, M.D., Ph.D. Director Age: 59 Director Since: 2014 Committees: Audit Compensation | Dr. Healy has served as a member of our board of directors since November 2014. Dr. Healy has been a general partner at Sofinnova Investments, Inc. (formerly Sofinnova Ventures), a biotechnology investment firm, since June 2000. Prior to June 2000, Dr. Healy held various positions at Sanderling Ventures, a venture capital firm, Bayer Healthcare Pharmaceuticals (as successor to Miles Laboratories), a research based pharmaceutical company, and ISTA Pharmaceuticals, Inc., a company specializing in ophthalmic pharmaceutical products. Dr. Healy is currently on the board of directors of ArriVent BioPharma, Inc., a clinical-stage oncology biopharmaceutical therapeutics company, Bolt Therapeutics, Inc., a clinical-stage oncology therapeutics company; Y-mAbs, an oncology biologics development company; and several private companies. Dr. Healy has previously served on the boards of directors of Ascendis Pharma A/S, Amarin Corporation, Auris Medical Holding AG, Karuna Therapeutics Inc., CinCor Pharma Inc., Coherus BioSciences, Inc., Edge Therapeutics, Inc., Hyperion Therapeutics, Inc., InterMune, Inc., Iterum Therapeutics plc, Anthera Pharmaceuticals, Inc., Durata Therapeutics, Inc., CoTherix, Inc., Movetis NV, NuCana plc, ObsEva SA; and several private companies. Dr. Healy has also previously served on the board of the National Venture Capital Association and the board of the Biotechnology Industry Organization. Dr. Healy holds a Bachelor of Arts in Molecular Biology and in Scandinavian Studies from the University of California at Berkeley, and an M.D. and Ph.D. in Immunology from Stanford University School of Medicine. Our board of directors believes that Dr. Healy is qualified to serve as a director due to his significant medical background, extensive experience investing and working in the life science industry, and his extensive service on the boards of directors of other public and private life sciences companies. Dr. Healy currently serves on our audit committee and on our compensation committee. |

  16. Incumbent Class I Directors With Terms Expiring in 2025

    | | Chief Executive Officer 43 Since: 2014 | | Dr. Marcus has served as a member of our board of directors since March 2017. Dr. Marcus is currently an assistant professor of health professions at Hofstra University, and previously served as assistant professor and director of the Global Healthcare Management and Biomedical Informatics programs, and as department chair of the Pharmaceutical Business and Administrative Services program, at the Massachusetts College of Pharmacy and Health Sciences from April 2016 to July 2019. From 2015 to September 2017, Dr. Marcus served as a consultant and practice leader in the healthcare consulting practice of Exceptional Leaders International, a consulting company. From October 2012 to December 2015, Dr. Marcus served as chief executive officer and president of Calloway Laboratories, a provider of clinical toxicology laboratory services. Prior to that, Dr. Marcus held a variety of leadership roles with diagnostics, pharmacy benefit management and managed care companies. Dr. Marcus currently serves on the boards of directors of a number of private companies and non-profit organizations. She previously served on the board of directors of Triple S Management Corp., an insurance holding company, from 2017 to 2022, and served on the Centers for Medicare & Medicaid Services Advisory Panel on Clinical Diagnostic Laboratory Tests from 2015 to 2019. Dr. Marcus also serves on the board of directors of several private biotechnology companies. Dr. Marcus holds a Bachelor of Arts in Spanish and Mathematics from Wesleyan University, an M.S.E. in Computer and Information Sciences from the University of Pennsylvania Moore School of Engineering, an M.B.A. from the Wharton School of the University of Pennsylvania, and a Doctorate of Health Administration from the Medical University of South Carolina. Our board of directors believes that Dr. Marcus is qualified to serve as a director based on her financial and managerial experience and service on other boards of directors. Dr. Marcus currently serves as the chair of our nominating, corporate governance and compliance committee and also serves on our audit committee. | Gail Marcus, D.H.A. Director Age: 67 Director Since: 2017 Committees: Nominating, Corporate Governance & Compliance (chair) Audit | | 65 Since: 2017 | |

  17. Incumbent Class I Directors With Terms Expiring in 2025

    | | Chief Executive Officer 43 Since: 2014 | | 65 Since: 2011 | | | Ruth Williams-Brinkley Director Age: 72 Director Since: 2023 Committees: Compensation | Ms. Williams-Brinkley joined our board of directors in March 2023. In January 2024, she formed RWB Advisory Services to focus on consulting and advisory services to healthcare organzations. Until January 2024, Ms. Williams-Brinkley served as president of Kaiser Foundation Health Plan of the Mid-Atlantic States, where she oversaw Kaiser Permanente’s care delivery and health plan operations in Washington, D.C., suburban Maryland, Baltimore, and Northern Virginia. Ms. Williams-Brinkley previously served as president of Kaiser Foundation Health Plan and Hospitals of the Northwest from November 2017 to June 2020. Prior to joining Kaiser Permanente, Ms. Williams-Brinkley served as president and chief executive officer of KentuckyOne Health, an affiliate of CommonSpirit Health and Kentucky’s largest integrated health system, from 2011 to 2017; as president and chief executive officer of Carondelet Health Network in Tucson, Arizona, an affiliate of Ascension Health, from 2008 to 2011; as president and chief executive officer of Memorial Health Care System in Chattanooga, Tennessee, an affiliate of CommonSpirit Health, from 2002 to 2008; and as corporate system vice president at CommonSpirit Health from 1998 to 2002. Ms. Williams-Brinkley has served on the board of directors of Travere Therapeutics, Inc., a biopharmaceutical company, since September 2021, and also currently serves on the board of directors of University of Phoenix and a number of not for profit organizations. Previously, she served as a member of the Board of Directors of Results Physiotherapy, a private care delivery company until it was acquired by Upstream Rehabilitation in 2021, and Chattem, Inc. until it was acquired by Sanofi in 2009. Earlier in her career, Ms. Williams-Brinkley held various nursing staff and management roles of increasing responsibility. Ms. Williams-Brinkley holds a Bachelor of Science and a Master of Science in nursing from De Paul University. Our board of directors believes that Ms. Williams-Brinkley is qualified to serve as a director based on her knowledge and extensive professional experience as a healthcare executive. Ms. Williams-Brinkley serves on our compensation committee. |

  18. Incumbent Class I Directors With Terms Expiring in 2025

    See “Corporate Governance” and “Corporate Governance — Director Compensation” below for additional information regarding our board of directors.

  19. Considerations in Evaluating Director Nominees

    Considerations in Evaluating Director Nominees When considering potential candidates for membership on our board of directors, our nominating, corporate governance and compliance committee considers relevant business and other experience, including the number of additional private and public companies on which such nominee serves, and demonstrated character and judgment, as described in our Policies and Procedures for Director Candidates, which are posted in the Investor Relations—Governance Documents section of our website at http://investor.natera.com. In addition, our nominating, corporate governance and compliance committee considers the current composition of the board of directors in its evaluation of candidates for membership. Our board of directors believes that factors such as range and diversity of expertise, perspective in areas relevant to our business, character, judgment, diversity, age, independence, expertise, experience, length of service and other commitments as it relates to each individual board member as well as the board of directors as a whole are important considerations in determining board composition. Our board of directors considers diversity to include both gender and racial/ethnic diversity, and is committed to actively seeking highly qualified women and individuals from minority groups to include in the pool from which new candidates are selected. Our nominating, corporate governance and compliance committee includes both gender and racial/ethnic diversity as significant factors to be considered along with the others listed above as a whole when evaluating a director candidate’s overall profile. Our nominating, corporate governance and compliance committee believes that, as a group, the nominees for election at the Annual Meeting complement the overall composition of our board of directors and bring a diverse range of backgrounds, experiences and perspectives to the board of directors’ deliberations. In considering director nominees, our nominating, corporate governance and compliance committee also considers any comments submitted by our stockholders regarding the service of such nominee. The nominating, corporate governance and compliance committee will consider stockholder nominations for directors submitted in accordance with the procedure set forth in our amended and restated bylaws and our Policies and Procedures for Director Candidates, which are each posted in the Investor Relations section of our website at http://investor.natera.com, as further described below under “Corporate Governance—Stockholder Recommendations for Nominations to the Board of Directors.” There are no differences in the manner in which our nominating, corporate governance and compliance committee evaluates a candidate that is recommended for nomination for membership on our board of directors by a stockholder, as opposed to a candidate that is recommended for nomination for membership on the board of directors by our nominating, corporate governance and compliance committee and our board of directors. Our nominating, corporate governance and compliance committee has not received any stockholder nominations in connection with the Annual Meeting.

  20. Director Compensation

    Director Compensation Our board of directors approves the form and amount of director compensation. Our compensation committee retains the services of Aon to advise it on the structure of our director compensation program and executive officers may make recommendations on the form and amount of director compensation, but the board makes the final decision and is not bound by compensation committee or executive officer recommendations. Pursuant to our non-employee director compensation program, our non-employee directors are entitled to receive an initial equity award upon joining our board of directors, and annual equity awards thereafter. Pursuant to such compensation program, during the year ended December 31, 2023, non-employee directors were each entitled to an annual equity award valued at $275,000, to be granted on or as soon as reasonably practicable following our annual meeting of stockholders. Each such annual equity award vests in full following the completion of 12 months of continuous service as a member of our board of directors following the grant date. Additionally, pursuant to such compensation program, any new non-employee directors are entitled to receive an initial equity award valued at $425,000, to be granted on or as soon as reasonably practicable following the date of such director’s initial election or appointment to our board of directors. Such initial equity award vests in equal annual installments over three years of continuous service following the director’s election to our board of directors. Each initial and annual equity award held by a non-employee director will become fully vested if we are subject to a change in control prior to the termination of a director’s service. Pursuant to our non-employee director compensation program, during the year ended December 31, 2023, each non-employee director could elect to receive: (i) 100% of the total dollar value of his or her initial and annual equity awards in the form of either restricted stock units (RSUs) or options to purchase shares of our common stock, or (ii) half of the total dollar value of his or her equity awards in RSUs and half in options, with the number of RSUs covered by an award determined based upon the average closing price per share of our common stock in the 30 calendar days prior to the date of grant and the number of shares underlying stock options calculated based on the Black-Scholes value of our common stock on the date of grant, as a percentage of the closing price per share of our common stock (Black-Scholes Percentage) on the date of grant, applied to the average closing price per share of our common stock in the 30 calendar days prior to the date of grant. Each such option has a term of ten years (subject to earlier expiration upon the termination of the director’s service) and was granted with an exercise price equal to the closing price per share of our common stock on the grant date. Effective beginning January 1, 2024, all equity awards are made in the form of RSUs. Under our 2015 Equity Incentive Plan (prior to its amendment and restatement on March 7, 2024), under which equity awards are granted to our non-employee directors as well as to our employees, the aggregate grant date fair value of awards granted to a non-employee director may not exceed $500,000 in any one fiscal year of the Company, except that the grant date fair value of awards granted to a newly appointed non-employee director may not exceed $1,000,000 in the fiscal year of the Company in which such director is initially appointed. In addition, during the year ended December 31, 2023, each non-employee director was entitled to receive compensation for his or her service on our board of directors and committees thereof consisting of annual cash retainers as set forth in the following table.

  21. Director Compensation

    | Position | Retainer ($) | | Board Member | 50,000* | | Lead Independent Director | 35,000 | | Audit Committee Chair | 20,000 | | Compensation Committee Chair | 20,000* | | Nominating, Corporate Governance and Compliance Committee Chair | 15,000* | | Audit Committee Member | 10,000 | | Compensation Committee Member | 7,500 | | Nominating, Corporate Governance and Compliance Committee Member | 5,000 | | Audit Committee Observer | 7,500 |

  22. Director Compensation

    | * Reflects an increase in the retainer amount effective as of June 9, 2023, which was approved by our board of directors upon the recommendation of the compensation committee to continue to bring our director compensation into closer alignment with our compensation philosophy. Prior to this increase, each non-employee director was entitled to receive an annual cash retainer of $45,000; the compensation committee chair was entitled to receive an annual cash retainer of $15,000; and the chair of the nominating, corporate governance and compliance committee was entitled to receive an annual cash retainer of $10,000. |

  23. Director Compensation

    Under our non-employee director compensation program, during the year ended December 31, 2023, each non-employee director could elect to receive all or a portion of his or her annual cash retainer(s) in the form of either fully vested options to purchase, or fully vested RSUs covering, shares of our common stock. Such options or RSUs were granted by our compensation committee on a quarterly basis, in arrears, with an aggregate grant date fair value equal to the elected cash amount that otherwise would have been payable for such quarter. The number of shares subject to such options were computed in accordance with the Black-Scholes method described above; each such option has a term of ten years (subject to earlier expiration upon the termination of the director’s service) and was granted with an exercise price equal to the closing price per share of our common stock on the grant date. The number of shares subject to such RSUs were computed based on the average closing price per share of the Company’s Common Stock in the 30 days prior to the grant date. Effective January 1, 2024, our non-employee directors may no longer elect to receive equity in the form of options in lieu of their annual cash retainers but may continue to elect to receive equity in the form of RSUs in lieu of their annual cash retainers. For 2023, each of Drs. Baynes and Healy and Mr. Rosenman continued to receive RSUs in lieu of their respective cash retainers based upon their prior election. Dr. Marcus continued to receive RSUs in lieu of one-half of her cash retainer and stock option awards in lieu of one-half of her cash retainer based on her prior election until June 2023, when she elected to start receiving her retainer entirely in cash. Mr. Botha continued to receive stock option awards in lieu of his cash retainer, based on his prior election. Ms. Williams-Brinkley, upon joining the board in February 2023, elected to receive stock option awards in lieu of her cash retainer. Dr. Chapman elected to receive her retainer entirely in cash. Pursuant to a March 2024 amendment to our non-employee director compensation program, effective beginning in 2024, the value of each non-employee director’s annual equity award has been increased to $325,000. In addition, the annual cash retainer for board member service was increased from $50,000 to $55,000; the additional annual cash retainer for the lead independent director and the audit committee chair was increased by $5,000; and the additional annual cash retainer for each non-chair committee member was increased by $2,500. Our compensation committee views such increases to be reasonable and appropriate given the overall increase in director responsibilities and time commitment as our company has matured and our business has expanded and grown in complexity. In addition, the lead independent director and the chair of each committee is entitled to receive, in addition to their annual cash retainers, an annual equity retainer valued at $45,000. Our board of directors, upon recommendation of the compensation committee with guidance from its independent compensation consultant, determined to award such retainer grants to reflect the significantly higher workload and time commitment of the lead independent director and the chair of each committee, while maintaining alignment of such directors to our stockholders’ interests. We have a policy of reimbursing our directors for their reasonable out-of-pocket expenses incurred in attending board of directors and committee meetings. The following table sets forth information about the compensation for service during the year ended December 31, 2023 of each of the non-employee members of our board of directors who served as a director during such year. A non-employee director is a director who is not employed by us and who does not receive compensation from us or have a business relationship with us that would require disclosure under certain SEC rules. Other than as set forth in the table and described more fully below, we did not pay any fees to, make any equity awards or non-equity awards to or pay any other compensation to the non-employee members of our board of directors for service during the year ended December 31, 2023. None of our employees who also served as members of our board of directors are included in the table below as such individuals did not receive any compensation from us for service as a director during the year ended December 31, 2023.

  24. Director Compensation

    | | Fees Earned or | Stock | Option | | | | Paid in Cash | Awards | Awards | Total | | Name | ($)(1) | ($)(2)(3) | ($)(2)(3) | ($) | | Roy Baynes | — | 184,036 | 133,698 | 317,733 | | Roelof Botha | — | 23,035 | 327,949 | 350,983 | | Rowan Chapman | 71,209 | 133,815 | 133,698 | 338,721 | | James Healy | — | 195,940 | 133,698 | 329,637 | | Gail Marcus | 54,354 | 275,237 | 7,625 | 337,217 | | Herm Rosenman | — | 205,461 | 133,698 | 339,159 | | Ruth Williams-Brinkley | 14,375 | — | 419,062 | 433,437 |

  25. Director Compensation

    | (1) The amounts shown in this column represent the aggregate amounts of all fees earned or paid in cash for services as a director in 2023 as described above. Dr. Chapman did not elect to receive equity in lieu of any portion of her cash retainers; Dr. Marcus and Ms. Williams-Brinkley each received fully vested options or RSUs in lieu of a portion of their cash retainers; and Drs. Baynes and Healy and Messrs. Botha and Rosenman received fully vested options or RSUs in lieu of all of their cash retainers. The following table summarizes the number of fully-vested RSUs or options granted to our non-employee directors in lieu of cash retainers for our fiscal year 2023 and includes the grant date fair value (computed in accordance with FASB ASC Topic 718) of each such award. |

  26. Director Compensation

    | | Date of | Type of | Number of Shares | Grant Date Fair Value | | Name | Grant | Award | Subject to Award | of Award ($) | | Roy Baynes | 4/14/2023 | RSUs | 228 | 11,719 | | | 7/28/2023 | RSUs | 264 | 12,112 | | | 10/27/2023 | RSUs | 322 | 12,320 | | | 1/1/2024 | RSUs | 215 | 14,070 | | Roelof Botha | 4/14/2023 | Options | 607 | 19,950 | | | 7/28/2023 | Options | 687 | 20,372 | | | 10/27/2023 | Options | 807 | 20,199 | | | 1/1/2024 | RSUs | 352 | 23,035 | | Rowan Chapman | | - | - | - | | James Healy | 4/14/2023 | RSUs | 285 | 14,649 | | | 7/28/2023 | RSUs | 328 | 15,049 | | | 10/27/2023 | RSUs | 396 | 15,151 | | | 1/1/2024 | RSUs | 264 | 17,276 | | Gail Marcus* | 4/14/2023 | RSUs | 148 | 7,607 | | | 4/14/2023 | Options | 232 | 7,625 | | Herm Rosenman | 4/14/2023 | RSUs | 331 | 17,013 | | | 7/28/2023 | RSUs | 380 | 17,434 | | | 10/27/2023 | RSUs | 454 | 17,370 | | | 1/1/2024 | RSUs | 303 | 19,828 | | Ruth Williams-Brinkley* | 4/14/2023 | Options | 120 | 3,944 | | | 7/28/2023 | Options | 428 | 12,692 | | | 10/27/2023 | Options | 515 | 12,890 |

  27. Director Compensation

    | * Pursuant to their elections to revert to cash compensation for their retainers beginning in 2023, Dr. Marcus’s quarterly retainers paid in July 2023, October 2023, and January 2024, and Ms. Williams-Brinkley’s quarterly retainer paid in January 2024, were in the form of cash instead of RSUs. |

  28. Director Compensation

    | (2) The amounts in these columns include the aggregate grant date fair value of stock awards and option awards granted during the year ended December 31, 2023, computed in accordance with FASB ASC Topic 718 (other than with respect to those stock awards and option awards described under footnote (1) above). See Note 9 to our consolidated financial statements included in our Annual Report on |

  29. Director Compensation

    Form 10-K for the year ended December 31, 2023 filed on February 29, 2024, for a discussion of the assumptions made by us in determining the grant date fair values of our equity awards.

  30. Director Compensation

    | (3) As of December 31, 2023, our non-employee directors held the following numbers of outstanding RSUs and options to purchase shares of our common stock: |

  31. Director Compensation

    | Name | RSUs | Options | | Roy Baynes | 2,750 | 56,879 | | Roelof Botha | 7,278 | 34,702 | | Rowan Chapman | 2,750 | 27,949 | | James Healy | 2,750 | 52,218 | | Gail Marcus | 5,500 | 40,586 | | Herm Rosenman | 2,750 | 163,249 | | Ruth Williams-Brinkley | — | 11,830 |

  32. I.Executive Summary

    Our compensation committee set challenging threshold and target revenue goals of $843.5 million and $992.4 million, respectively, which represented year-over-year growth of approximately 10.3% and 21.0%, respectively, over our 2022 performance. The product gross margin threshold and target goals were set at 33.3% and 41.6%, respectively. The operating cash flow threshold and target goals were set at $(473.8) million and $(379.0) million, respectively. All three goals were designed to require substantial effort, taking into account the extensive investments, operating goals, and strategic priorities planned for the year. Our compensation committee selected these metrics to incentivize the executive officers in the critical strategic priorities determined by our board of directors, consisting of top line revenue growth, operating profitability and cash flow management. The intent of each of the minimum threshold goals was to help motivate performance for what were considered challenging goals, and to reward efforts that may have resulted in substantial, though not complete, achievement of the target metrics. As described above, we grew total revenue in 2023 by 32% to $1,082.6 million. This was driven primarily by a 34% increase in product revenues, attributable to an increase in both volumes and average selling price during the year. Our gross margins also increased to 45.5%. Our operating cash flow improved significantly to $(267.1) million. Our achievement on each of these performance metrics in 2023 exceeded the pre-established targets for such measures. Based on these financial results, the compensation committee determined that the overall weighted company financial achievement relative to the goals was 112.0% of target, as further discussed in the section below titled “Annual Cash Incentive Plan”. This level of achievement reflects a significant increase from the overall weighted company financial achievement of 84.2% of target for 2022, despite similarly rigorous and challenging performance metrics. 2023 Long-Term Incentives. In 2023, the long-term incentive equity awards granted to our NEOs were allocated equally (50%/50%) between performance-based and time-based awards. The long-term incentive awards granted to our NEOs in 2023 were in the form of PSUs and time-based RSUs, with the exception of our Executive Chairman, who received grants of performance based stock options (PSOs) and time-based stock options. The compensation committee believes that, as the Company evolves and grows, the metric in the long-term incentives awarded to our executive officers should also evolve to have a longer measurement period of three years. The 2023 long-term incentive equity awards reflected a transition towards a three-year measurement period, with 60% of the PSUs (30% of the overall long-term incentive opportunity for the year) being based on three-year cumulative revenue and 40% of the PSUs (20% of the overall long-term incentive opportunity for the year) being based on two-year cumulative revenue. The PSUs granted in January 2024 are 100% based on a three-year performance period. The compensation committee believes that having a longer measurement period motivates performance over the long term to drive top line growth. Each performance-based award requires the achievement of a cumulative two- or three-year revenue target designed to be achievable, with substantial effort, within the respective measurement periods; and the time-based awards vest incrementally over four years, consistent with our standard vesting schedule, subject to continued service. Our compensation committee believes that the combination of performance-based and time-based awards incentivizes both the achievement of business and operational goals as well as continued service and retention. Our compensation committee did not award any special or one-time equity grants to our NEOs in 2023.

  33. II. Compensation Philosophy and Objectives

    II. Compensation Philosophy and Objectives The primary objectives of our executive compensation program are to: Reward the achievement of specified performance goals (pay for performance): Our compensation committee has designed our executive compensation program to include both cash and equity incentives tied to performance goals to motivate our executive officers to achieve key business objectives by tying the value of the compensation they receive to our performance relative to these business objectives. Align our executive officers’ interests with those of our stockholders through long-term incentives linked to revenue growth and enhancement of stockholder value that also facilitate executive retention: Our compensation committee uses equity for long-term incentive opportunities in order to motivate and reward executive officers to (i) deliver sustained long-term value to stockholders and (ii) achieve multiyear strategic goals, such as revenue growth. Our compensation committee believes using equity based on a mix of time- and performance-based goals creates strong alignment between the interests of our executive officers and those of our stockholders. Attract, retain and motivate superior executive talent with market competitive compensation: We must compete for executive talent in the fiercely competitive biopharmaceutical and technology industries in Austin, Texas and Silicon Valley, California. We seek high-caliber executive officers and managers who have diverse experience, expertise, capabilities and backgrounds to manage our business and carry out our strategy. Our compensation committee references the amounts and structures of compensation received by executive officers of the companies in our compensation peer group and in industry surveys in connection with recruiting our executive officers and determining competitive pay levels. Compensation Program Governance Our compensation committee assesses the effectiveness of our executive compensation program from time to time and reviews risk mitigation and governance matters, which includes maintaining the following best practices:

  34. III. Compensation Determination Process

    III. Compensation Determination Process Role of the Compensation Committee Pursuant to its charter, our compensation committee was established by our board of directors to assist with its oversight of the forms and amounts of compensation for our CEO and our other executive officers. Specifically, our compensation committee reviews annually and determines the appropriate compensation levels for our CEO and Executive Chairman and, in consultation with our CEO, our other executive officers, including base salaries, cash and equity-based incentive compensation, and employment or severance or change in control agreements. Our compensation committee establishes annual corporate goals and objectives for our CEO and other executive officers, in consultation with our management, and evaluates performance against such goals. Such goals and objectives also form the framework for the incentive compensation program applicable to our employee population at large. Our compensation committee also administers our incentive plans for employees and other service providers, including our equity incentive plans, although it has delegated to our CEO and CFO joint authority to approve certain equity award grants and modifications (other than to our directors and executive officers) within established and specified guidelines and limitations. Finally, our compensation committee recommends to our board of directors for its approval the form and amount of compensation to be paid to the non-employee members of our board of directors. Our compensation committee believes that the total compensation paid to our executive officers should be fair, reasonable and competitive, and that a significant portion of the total compensation should be tied to our annual and long-term performance. Role of the Independent Compensation Consultant Our compensation committee believes it is useful to obtain independent, objective expertise and counsel in connection with fulfilling its duties, and has the authority to retain an independent compensation consultant to assist it in carrying out its responsibilities and duties. Our compensation committee retained Aon’s Human Capital Solutions practice, a division of Aon plc (Aon), as its independent compensation consultant for 2023 compensation decisions. Aon reports directly to our compensation committee, and our compensation committee has the sole authority to retain, terminate and obtain the advice of Aon at our expense. For 2023, Aon reviewed and advised on all principal aspects of our executive and non-executive compensation programs, including:

  35. III. Compensation Determination Process

    | ● | assisting in developing a peer group of publicly traded companies to help assess our compensation programs; |

  36. III. Compensation Determination Process

    | ● | assisting in developing a competitive compensation strategy and consistent executive and non-executive compensation assessment practices relevant to a public company, including review and recommendation of our performance-based cash and equity-based incentive programs, as well as our equity strategy covering type of equity, dilution, and grant levels; |

  37. III. Compensation Determination Process

    When making decisions about our executive compensation program, while our compensation committee takes into consideration the review and recommendations of Aon, ultimately our compensation committee makes its own independent decisions in determining our executives’ compensation. Pursuant to SEC and Nasdaq rules, our compensation committee assessed the independence of Aon. Our compensation committee considered each of the factors set forth by the SEC and Nasdaq with respect to a compensation consultant’s independence in doing so. Our compensation committee also considered the nature and amount of work performed for it and the fees paid for those services in relation to the firm’s total revenues. Our compensation committee concluded that Aon was independent and that there were no conflicts of interest on the basis of its consideration of the foregoing and other relevant factors. Compensation Peer Groups and Peer Selection Process Relevant market and benchmark data provide a solid reference point and helpful context for making executive compensation decisions. When making decisions about structure and component mix in designing our executive compensation program, our compensation committee takes into consideration the structure and components of, and the amounts paid under, the executive compensation programs of comparable peer companies, as derived from public filings and other sources. With the assistance of Aon, our compensation committee developed a compensation peer group using the following criteria: life sciences industry with an emphasis on companies in the genetic testing / bioinformatics space, revenue, market capitalization, headcount, and geography. In an effort to maximize the appropriateness and thus usefulness of the compensation peer group, our compensation committee adjusted the market capitalization criteria used to select the compensation peer group used for 2023 decisions, to reflect a range of one-fourth to four times our trailing 30-day average market capitalization at the time of the analysis in July 2022. Our compensation committee removed companies in the existing compensation peer group that no longer met the criteria, and added companies that were aligned with the criteria. Specifically, the committee removed Insulet, Invitae, Luminex, and NanoString Technologies, and added Exact Sciences, Ionis Pharmaceuticals, Myriad Genetics, Neurocrine Biosciences, and Ultragenyx Pharmaceutical. Based on these criteria and considerations, the compensation committee approved a peer group for decisions relating to 2023 executive compensation that consisted of the following companies:

  38. III. Compensation Determination Process

    | | Market Cap | Revenue | | Peer Company Statistics (At the Time of Approval) | ($mm) | ($mm)(1) | | 25th percentile | $3,841.2 | $308.4 | | Median | $5,593.9 | $433.0 | | 75th percentile | $13,046.9 | $757.6 | | Natera, Inc. | $9,974.6 | $449.3 | | Natera’s Percentile Rank vs. Peers | 64th %ile | 58th %ile |

  39. IV. Compensation Program Components

    Base Salary Base salaries help us to attract and retain the executive talent needed to lead the business and maintain a stable leadership team and provide fixed compensation to executive officers. Base salaries vary among executive officers based on a variety of considerations, including skills, experience, achievements, performance and the competitive market for the position, and are individually determined according to each executive officer’s areas of responsibility, role and experience. Our compensation committee previously determined that our CEO’s target total cash compensation (comprising base salary and target incentive bonus opportunity) has historically been below the median of our compensation peers. Accordingly, our compensation committee has increased our CEO’s target total cash compensation in recent years to incrementally bring such compensation closer to alignment with the median of our compensation peer group. In 2023, in a continued effort to bring our CEO’s base salary into alignment with the median of the competitive market and to recognize the efforts that resulted in our strong financial performance, our compensation committee increased our CEO’s base salary by 11.1%, to position him at the 43rd percentile of our compensation peer group. Our other NEOs, other than our Executive Chairman (whose salary is set in his employment agreement, as most recently amended in 2023), received modest increases in order to maintain alignment with our compensation peer group, and which increases were generally consistent with our overall employee population. The following were the annual base salaries of our NEOs for 2023, including a comparison to 2022.

  40. IV. Compensation Program Components

    (1)Mr. Schueren’s base salary of $488,600 was pro-rated to reflect his transition to part-time status in 2023. From time to time, our compensation committee may consider and approve base salary adjustments for executive officers. The main considerations for a salary adjustment are similar to those used in initially determining base salaries, but may also include a change in our compensation peer group or the broader competitive market, change of role or responsibilities, recognition for achievements and performance, or market trends. Our compensation committee establishes initial base salaries for newly-hired executive officers through arm’s-length negotiations at the time the executive officer is hired, taking into consideration the factors described above. Annual Cash Incentive Plan To focus and incentivize our executives to achieve short-term corporate financial performance objectives and reward performance and our overall success, with the intent ultimately of increasing stockholder value, a portion of each NEO’s compensation is tied to the achievement of our annual goals. Our NEOs are eligible to receive annual cash incentive awards, with the target bonus opportunity determined as a percentage of their base salary. The amount of the payout, if any, under the annual incentive plan is based upon achievement relative to company performance targets, and for NEOs other than our CEO and Executive Chairman, individual performance. The following were the target bonus opportunities of our NEOs, effective January 27, 2023, as a percentage of their respective 2023 base salaries, as well as the relative weighting of company and individual performance for purposes of calculating their annual cash incentive payout.

  41. IV. Compensation Program Components

    | | Target Incentive Bonus | Company Performance | Individual Performance | | NEO | (% of Base Salary) | (%) | (%) | | Steven Chapman | 100 | 100 | — | | Michael Brophy | 50 | 80 | 20 | | Robert Schueren | 50 | 80 | 20 | | Daniel Rabinowitz | 45 | 50 | 50 | | Matthew Rabinowitz | 85 | 100 | — |

  42. IV. Compensation Program Components

    In setting the performance metric levels, our compensation committee chose target goals that it considered rigorous and challenging and that took into account the relevant risks and opportunities, and our business objectives. In particular, our compensation committee reviewed the relevant financial objectives set as a result of the development of the fiscal year budget, considering various risks of achieving specific actions that underlie the targets, the implied performance relative to prior years, and risks associated with various macroeconomic factors. Our compensation committee also set a threshold performance goal for each financial metric below which no payout would be earned for such metric, and maximum payout amounts for each metric. The intent of the threshold performance goal was to help motivate performance for what were considered challenging goals, and to reward efforts that may have resulted in substantial, though not complete, achievement of the metrics. The thresholds and maximums for each metric are set forth in the table in “—Achievement” below. Achievement Based upon a review of our audited financial results and performance for 2023, our compensation committee confirmed achievement of our company performance goals as set forth in the “Metric Achieved” column in the table below, resulting in an overall weighted average payout of 112.0% of such goals.

  43. IV. Compensation Program Components

    | | Relative | | | | | | | | | Weighting | | | | | Achievement | Weighted Payout | | Performance Metric | (%) | Threshold | Target ($) | Maximum | Metric Achieved | (% of target) | (% of target payout) | | Revenue | 55 | $843.65 million | $992.5 million | $1,141.4 million | $1,082.6 million | 109.1% | 112.1% | | Payout Percentage (% of Target) | | 85% | 100% | 115% | | | | | Product Gross Margin | 35 | 33.3% | 41.6% | 49.9% | 45.5% | 109.5% | 109.5% | | Payout Percentage (% of Target) | | 80% | 100.0% | 120% | | | | | Cash Burn | 10 | $(473.4) million | $(378.7) million | $(284.0) million | $(267.1) million | 141.8% | 120.0% | | Payout Percentage (% of target) | | 75% | 100% | 125% | | | | | Payout | | 50% | 100% | 120% | | | 112.0% |

  44. IV. Compensation Program Components

    | | Total | Financial Performance Goals | | Individual Performance Factor | | | Total Actual* | | | | Target* | | | Target | Achievement | Payout | Award | Total Payout | | Executive Officer | Bonus ($) | Target ($) | Payout ($) | ($) | (%) | ($) | ($) | (% of Target) | | Steven Chapman | 744,658 | 744,658 | 833,793 | N/A | N/A | N/A | 833,793 | 111.97% | | Michael Brophy | 230,523 | 184,418 | 206,493 | 46,105 | 100% | 46,105 | 252,598 | 109.58% | | Robert Schueren | 133,863 | 107,090 | 119,909 | 26,773 | 100% | 26,773 | 146,682 | 109.58% | | Daniel Rabinowitz | 182,207 | 91,104 | 102,009 | 91,104 | 100% | 91,104 | 193,112 | 105.99% | | Matthew Rabinowitz | 327,677 | 327,677 | 366,900 | N/A | N/A | N/A | 366,900 | 111.97% |

  45. IV. Compensation Program Components

    Long-Term Incentives Long-term equity incentives represent the largest component of the executive compensation program. The long-term incentive opportunity is designed to motivate and reward executive officers to achieve multiyear strategic goals and deliver sustained long-term value to stockholders. Our compensation committee has found equity vehicles to be effective in aligning the interests of management, including our NEOs, to company financial and business performance and to the creation of overall stockholder value, and to appropriately reward executives for growing our business. Long-term incentive awards are granted annually as a component of executive compensation; in addition, our compensation committee generally also grants long-term incentive awards to individuals who are promoted to a senior executive position to recognize the increase in the scope of his or her role and responsibilities and to incentivize such individual accordingly, as well as in situations involving a leadership transition, or to newly-hired executive officers. Our compensation committee has committed to structuring the executive compensation program with the aim of avoiding or limiting the need for equity awards beyond those described in the foregoing; any such special equity awards would be granted judiciously and only in rare circumstances as may be warranted, with enhanced disclosure of the rationale for any such grants. We utilize both performance-based and time-based equity awards. Our performance-based equity awards comprise 50% of each NEO’s target equity grant, and vest upon the achievement of specified business goals. Our compensation committee believes that a 50/50 mix of performance-based and time-based awards appropriately balances the incentives of achieving business and operational goals with continued service and retention. These equity incentives are a critical component of our executive compensation program and support a compensation philosophy that emphasizes pay that rewards performance. Because executive officers will generally only receive value from the time-based and performance-based equity awards if they remain employed by us over the required term, long-term equity incentives promote retention and foster an ownership culture among our executive officers, as they are also stockholders with a personal stake in the value they are incentivized to create. In 2023, our NEOs received PSUs complemented by time-based RSUs, except for our Executive Chairman who received PSOs complemented by time-based stock options. The compensation committee believes that, as the Company evolves and grows, the metric in the long-term incentives awarded to our executive officers should also evolve to have a longer measurement period, with vesting conditions designed to be achievable, with a substantial degree of effort, within such measurement period. As such, the 2023 long-term incentive equity awards reflected a transition towards a three-year measurement period, with 60% of the PSUs (30% of the overall long-term incentive opportunity for the year) being based on three-year cumulative revenue and 40% of the PSUs (20% of the overall long-term incentive opportunity for the year) being based on two-year cumulative revenue. The PSUs granted in January 2024 are based solely on a three-year performance period. The compensation committee believes that having a longer measurement period motivates performance over the long-term to build long-term stockholder value.

  46. IV. Compensation Program Components

    | Equity Vehicle | Vesting Condition | Rationale for Use | | Performance-based equity awards (PSUs and PSOs), comprising 50% of the annual refresh award | ● 2023-2025 cumulative revenue (60% of PSU/PSO total) ● 2023-2024 cumulative revenue (40% of PSU/PSO total) | Focuses executive leadership team on singular goal of growing top line revenues over the long term and expanding market share to fuel further growth | | Time-based equity awards (RSUs and stock options), comprising 50% of the annual refresh award | 4-year period; 25% vests 12 months after the grant date, with the remainder vesting quarterly thereafter | ● Aligns with stockholders ● Promotes retention ● Reinforces an ownership culture and a commitment to our company |

  47. IV. Compensation Program Components

    As noted above, the vesting conditions for the 2023 PSUs and PSOs were designed to be challenging but achievable. The threshold, target and maximum vesting for the 2023 PSUs and PSOs are set forth below, and reflect an emphasis on strongly incentivizing achievement above target while rewarding substantial efforts towards the target.

  48. IV. Compensation Program Components

    | Performance Level | Performance Relative to Goal | Vesting / Payout | | | (% of target) | (% of target) | | Threshold | 95% | 50% | | Target | 100% | 100% | | Maximum | 105% | 200% |

  49. IV. Compensation Program Components

    Target Value for 2023 Awards Our compensation committee establishes the target value of long-term incentive opportunities for each of the NEOs. In determining the value and size of the long-term incentive opportunity, our compensation committee considers:

  50. IV. Compensation Program Components

    | ● | the values of, allocations to, and proportion of total compensation represented by, the long-term incentive opportunities at our compensation peer group companies; our compensation committee’s general philosophy is to target a long-term incentive value equal to approximately the 75th percentile of our compensation peer group; |

  51. IV. Compensation Program Components

    | | Grant Value | PSUs | PSUs | RSUs | RSUs | PSOs | PSOs | Stock Options | Stock Options | | NEO | ($)(1) | ($)(1) | (#)(2)(3) | ($) | (#)(2) | ($)(1) | (#)(2)(3) | ($) | (#)(2) | | Steven Chapman | 10,250,000 | 5,125,000 | 127,265 | 5,125,000 | 127,265 | — | — | — | — | | Michael Brophy | 4,000,000 | 2,000,000 | 49,664 | 2,000,000 | 49,664 | — | — | — | — | | Robert Schueren | 1,600,000 | 800,000 | 19,865 | 800,000 | 19,865 | — | — | — | — | | Daniel Rabinowitz | 2,500,000 | 1,250,000 | 31,040 | 1,250,000 | 31,040 | — | — | — | — | | Matthew Rabinowitz | N/A | N/A | N/A | N/A | N/A | 4,100,000 | 152,643 | 4,100,000 | 152,643 |

  52. IV. Compensation Program Components

    | (1) Includes the value of the PSUs and PSOs, as applicable, at target achievement. The value of the PSUs and PSOs at maximum achievement is set forth in footnote 1 to the Summary Compensation Table beginning on page 59. |

  53. IV. Compensation Program Components

    | (3) Share numbers represent achievement at 100% of target. The maximum number of shares subject to the PSUs and PSOs is 200% of the shares included in the table for achievement of the applicable revenue goal at 105% of target. |

  54. IV. Compensation Program Components

    The following is a summary of each NEO’s performance-based equity awards that remained outstanding and subject to vesting conditions as of December 31, 2023. Consistent with our compensation committee’s philosophy of incentivizing and rewarding significant effort and strong performance, the vesting conditions represent ambitious goals designed to incorporate important company initiatives and alignment with stockholder interests. The incentives are long-term, with performance periods ranging from two to six years from the date of grant.The majority (based on market value) of the awards require such achievement to be maintained for 15 months in order for the corresponding award to fully vest. For the 2023 PSUs and PSOs, the summary below assumes achievement at 100% of target.

  55. IV. Compensation Program Components

    | | | Market Value(1) | | Market Value(2) | Performance | | | Award | (on date of grant) | Grant | (as of 12/29/2023) | Period | | NEO | Type | ($) | Date | ($) | (from grant date) | | Steven Chapman | PSU | 8,188,500 | 1/22/2021 | 4,698,000 | 6 years | | | PSO | 9,877,500 | 1/22/2021 | 5,836,500 | 6 years | | | PSU | 4,450,000 | 1/28/2022 | 3,393,522 | 3 years | | | PSU | 5,125,000 | 1/27/2023 | 7,971,880 | 3 years (60%) 2 years (40%) | | Michael Brophy | PSU | 2,729,500 | 1/22/2021 | 1,566,000 | 6 years | | | PSU | 2,000,000 | 1/28/2022 | 1,525,159 | 3 years | | | PSU | 2,000,000 | 1/27/2023 | 3,110,953 | 3 years (60%) 2 years (40%) | | Robert Schueren | PSU | 2,729,500 | 1/22/2021 | 1,566,000 | 6 years | | | PSU | 2,000,000 | 1/28/2022 | 1,525,159 | 3 years | | | PSU | 800,000 | 1/27/2023 | 1,244,344 | 3 years (60%) 2 years (40%) | | Daniel Rabinowitz | PSU | 1,149,300 | 10/22/2021 | 626,400 | 6 years | | | PSU | 1,125,000 | 1/28/2022 | 857,917 | 3 years | | | PSU | 1,125,000 | 1/27/2023 | 1,943,725 | 3 years (60%) 2 years (40%) | | Matthew Rabinowitz | PSO | 8,204,631 | 5/28/2021 | 6,332,914 | 6 years | | | PSO | 3,880,800 | 1/28/2022 | 4,280,100 | 3 years | | | PSO | 4,100,000 | 1/27/2023 | 5,939,339 | 3 years (60%) 2 years (40%) |

  56. IV. Compensation Program Components

    | (1) Market value of PSUs is based on the fair market value of our common stock at the close of trading on the date of grant. Market value of PSOs is based on the Black-Scholes value of our common stock on the date of grant. |

  57. IV. Compensation Program Components

    | (2) Market value of PSUs is based on the fair market value of our common stock at the close of trading on December 29, 2023, the last trading day of fiscal year 2023, which was $62.64. Market value of PSOs is based on the Black-Scholes value of our common stock on December 29, 2023. |

  58. IV. Compensation Program Components

    Other Elements of Compensation Retirement Benefits We have established a 401(k) tax-deferred savings plan, which permits participants, including our NEOs, to make contributions by salary deduction pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. We are responsible for administrative costs of the 401(k) plan. We match contributions made by our employees, including our NEOs, to the 401(k) plan in an amount equal to 50% of the employee’s contribution, up to 6% of the employee’s compensation (comprising base salary and bonus) and subject to other limitations under applicable laws. For all employees hired on or after January 1, 2015, matching contributions vest 25% after the first full year of service, 50% after the second full year of service, 75% after the third full year of service, and 100% after the fourth full year of service. Matching contributions are fully vested for all employees hired before January 1, 2015. As of the date of this proxy statement, matching contributions are fully vested for all of our NEOs. Health and Welfare Benefits; Perquisites Our NEOs are eligible to participate in our health and welfare plans to the same extent as are all full-time employees generally. Benefits offered to our NEOs serve a different purpose than do the other elements of total compensation. In general, they are designed to provide a safety net of protection against the financial catastrophes that can result from illness, disability or death. Our NEOs do not receive any perquisites or other personal benefits. Change in Control and Severance Arrangements As further described immediately below and in “Severance and Change in Control Benefits” further below, we believe that the possibility of a change in control creates uncertainty for our officers regarding their continued employment because such transactions frequently result in senior management changes. Change in control protections help to alleviate concerns of our officers regarding the possible occurrence of such a transaction, allowing them to focus their attention on our business. In addition, these protections encourage executives to remain with us during the threat or negotiation of a change in control transaction, which preserves our value and the potential benefit to be received by our stockholders in the transaction. We also believe that protection against an involuntary termination (even outside of the change in control context) helps us remain competitive given the challenge of recruiting qualified individuals to fill our senior executive roles. Pursuant to our arrangements with each of our NEOs, if we terminate the employment of such executive for reasons other than good cause (including such executive’s death or permanent disability), or if such executive resigns for certain good reasons, then he will be eligible to receive certain cash severance and other benefits and accelerated vesting of equity or equity-based awards, with such benefits enhanced if such involuntary termination occurs in connection with our change in control. Generally, such benefits are contingent on execution of a general release of claims by the officer. We have not provided any excise tax gross-ups to any of our NEOs in the event of a change in control. Additional details are provided under “Severance and Change in Control Benefits” below. Pursuant to his amended and restated employment agreement with us, prior to its amendment in April 2023, Dr. Rabinowitz was eligible for accelerated vesting of certain of his equity awards if we are subject to a change in control (regardless of whether he also experiences an involuntary termination in connection with such change in control). Pursuant to an amendment of such employment agreement in April 2023, this provision was removed. The terms of Dr. Rabinowitz’s agreement are described in further detail under “Severance and Change in Control Benefits” below. Certain Developments Following End of Our 2023 Fiscal Year In January 2024, as part of its annual review of executive compensation, our compensation committee approved the following base salaries, annual target cash incentive bonus opportunities, and relative weighting of company and individual performance, for our NEOs. The “2024 Base Salary” column in the table below reflects each executive officer’s base salary effective as of January 1, 2024.

  59. V.Additional Compensation Policies and Practices

    Individuals covered by our stock ownership policy are expected to attain the applicable target ownership within five years of the later of (i) policy adoption, (ii) promotion (where a new guideline applies), or (iii) joining the Company or board of directors, as applicable. As of the end of 2023, all of our NEOs and directors were in compliance with our stock ownership policy. Clawback Policy We have adopted a Clawback Policy to provide for the recovery of certain incentive compensation in the event of an accounting restatement and to comply with the clawback rules found in 17 C.F.R. Section 240.10D and the related Nasdaq Listing Rules. A copy of our Clawback Policy and any amendments has been filed as an exhibit to our annual report on Form 10-K. Risk Analysis of Our Compensation Plans Our management assesses and discusses with our compensation committee our compensation policies and practices for our employees as they relate to our risk management. Based on this assessment, we do not believe that any risks arise from such policies and practices that are reasonably likely to have a material adverse effect on us now or in the future. Timing of Equity Awards Grants of equity awards to our executive officers are generally determined and approved at our pre-scheduled quarterly compensation committee meetings whenever practicable, and the awards are granted in accordance with our equity grant policies and processes. In addition, our compensation committee approves the annual equity refresh grants, including performance-based awards, in the first quarter of each year. However, our compensation committee may otherwise approve the grant of equity awards outside of a pre-scheduled meeting in connection with a new hire, promotion, and other circumstances where our compensation committee deems it appropriate to make such grants. Tax Considerations: Section 162(m) When reviewing compensation matters, our compensation committee considers the anticipated tax consequences to us (and, when relevant, to our executive officers) of the various payments under our compensation programs. Section 162(m) of the Code generally disallows a tax deduction for any publicly held corporation for individual compensation of more than $1.0 million in any taxable year to certain executive officers. Our compensation committee, after considering the potential impact of the application of Section 162(m) of the Code, may provide compensation to executive officers that may not be tax deductible if it believes that providing that compensation is in the best interests of us and our stockholders. Accounting for Stock-Based Compensation We follow the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718 (ASC Topic 718), for our stock-based compensation awards. ASC Topic 718 requires companies to calculate the grant date “fair value” of their stock-based awards using a variety of assumptions. ASC Topic 718 also requires companies to recognize the compensation cost of their stock-based awards in their income statements over the period that an employee is required to render service in exchange for the award. Grants of stock options and both performance-based and time-based RSUs under our equity incentive award plans are accounted for under ASC Topic 718. Our board of directors or its compensation committee will regularly consider the accounting implications of significant compensation decisions, especially in connection with decisions that relate to our equity incentive award plans and programs. As accounting standards change, our compensation committee may revise certain programs to appropriately align accounting expenses of equity awards with the overall executive compensation philosophy and objectives.

  60. Summary Compensation Table

    Summary Compensation Table The following table provides information concerning the compensation for services rendered during the years ended December 31, 2021, 2022 and 2023 by our Chief Executive Officer, Chief Financial Officer and our three other executive officers as of December 31, 2023, whom we refer to as our named executive officers or NEOs.

  61. Summary Compensation Table

    | | | | | | Non-Equity | | | | | | | Stock | Option | Incentive Plan | All Other | | | Name and Principal | | Salary | Awards | Awards | Compensation | Compensation | Total | | Position | Year | ($) | ($)(1) | ($)(1) | ($)(2) | ($)(3) | ($) | | Steven Chapman | 2023 | 751,052 | 11,133,142 | — | 833,793 | 9,900 | 12,727,887 | | Chief Executive Officer and President | 2022 | 609,622 | 7,093,675 | — | 533,834 | 9,150 | 8,246,281 | | | 2021 | 525,732 | 14,031,437 | 8,386,125 | 391,153 | 8,700 | 23,343,147** | | Michael Brophy | 2023 | 465,293 | 4,344,607 | — | 252,598 | 6,727 | 5,069,225 | | Chief Financial Officer | 2022 | 407,714 | 3,188,127 | — | 194,901 | 8,730 | 3,799,472 | | | 2021 | 436,732 | 9,096,200 | — | 216,242 | 8,529 | 9,757,703** | | Robert Schueren* | 2023 | 274,491 | 1,737,790 | — | 146,682 | 7,981 | 2,166,944 | | Chief Operating Officer | 2022 | 431,855 | 3,188,127 | — | 206,117 | 6,998 | 3,833,097 | | | 2021 | 464,756 | 9,096,200 | — | 233,263 | 8,700 | 9,802,919** | | Daniel Rabinowitz | 2023 | 407,594 | 2,715,379 | — | 193,112 | 9,900 | 3,325,985 | | Chief Legal Officer | 2022 | 394,734 | 1,793,354 | — | 162,150 | 9,150 | 2,359,388 | | | 2021 | 379,309 | 3,415,333 | — | 169,459 | 8,700 | 3,972,801** | | Matthew Rabinowitz | 2023 | 401,484 | — | 8,199,982 | 366,900 | — | 8,968,366 | | Executive Chairman | 2022 | 300,921 | — | 7,761,600 | 140,664 | — | 8,203,185 | | | 2021 | 334,002 | — | 9,626,909 | 168,210 | — | 10,129,121** |

  62. Summary Compensation Table

    | * Mr. Schueren’s compensation in 2023 was pro-rated to reflect his transition to part-time status during the year. |

  63. Summary Compensation Table

    | ** Includes the value of performance-based equity awards that will only vest upon our achievement of performance milestones within a six-year performance period. Such milestones had not been achieved, and the associated value therefore not earned, as of December 31, 2023. The awards based on such milestones represent 85% of the total reported value of the equity awards granted in such year with respect to Mr. Chapman, 76% with respect to Mr. Brophy, 76% with respect to Mr. Schueren, 64% with respect to Mr. Rabinowitz, and 85% with respect to Dr. Rabinowitz. |

  64. Summary Compensation Table

    | (1) Represents the aggregate grant date fair value of equity awards granted to the officer in the applicable fiscal year, computed in accordance with FASB ASC Topic 718. See Note 9 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed on February 29, 2024 for a discussion of the assumptions made by us in determining the grant date fair value of our equity awards. The fair value of performance-based awards with market conditions are estimated using a Monte Carlo simulation model. |

  65. Summary Compensation Table

    Each of our NEOs was granted performance-based awards in January 2023, the vesting of which is tied to our achievement of specified cumulative two- and three-year annual revenue goals, as described in greater detail in the “Long-Term Incentives” section of the “Compensation Discussion and Analysis” section on page 52. In accordance with SEC rules, the grant date fair value of an award subject to a performance condition is based on the probable outcome of the condition at the time of grant. For each of the performance-based awards granted to our NEOs in January 2023, it was determined at the time the awards were made that achievement was probable at the target level. As a result, for the performance-based awards reflected in the table, the grant date fair value assumes such awards will become eligible to vest at their target level;. The following table sets forth the amounts included in the Stock Awards and Option Awards columns, and the grant date fair value of such awards assuming achievement at the maximum level (for vesting at the maximum levels) with respect to such awards.

  66. Summary Compensation Table

    | Name | Performance Period | Amount Included in Stock/Option Awards Column ($) | Grant Date Fair Value At Maximum ($) | | Steven Chapman | 2023-2024 | 2,226,628 | 4,453,257 | | | 2023-2025 | 3,339,943 | 6,679,885 | | Michael Brophy | 2023-2024 | 868,939 | 1,722,131 | | | 2023-2025 | 1,303,365 | 2,606,729 | | Robert Schueren | 2023-2024 | 347,558 | 695,116 | | | 2023-2025 | 521,337 | 1,042,674 | | Daniel Rabinowitz | 2023-2024 | 543,076 | 1,086,152 | | | 2023-2025 | 814,614 | 1,629,228 | | Matthew Rabinowitz | 2023-2024 | 1,639,991 | 3,279,982 | | | 2023-2025 | 2,460,000 | 4,920,000 |

  67. Summary Compensation Table

    | (2) Represents amounts earned pursuant to our Management Cash Incentive Plan. For 2023, the amounts earned by the NEOs were paid in the form of fully vested RSUs, which were granted on March 1, 2024, with the number of RSUs determined based on the Company’s closing price on the Nasdaq Stock Market on March 1, 2024. |

  68. Summary Compensation Table

    | (3) Represents Company matching contributions made to the executive officer’s 401(k) account. |

  69. 2023 Grants of Plan-Based Awards

    2023 Grants of Plan-Based Awards The following table sets forth certain information regarding each plan-based award granted to our named executive officers during the fiscal year ended December 31, 2023. Except as otherwise indicated in the footnotes to the table below, all of the following awards were made under our 2015 Equity Incentive Plan. For a description of the acceleration of vesting provisions applicable to the stock options and stock units granted to our named executive officers, see the section of this proxy statement entitled “Severance and Change in Control Benefits.”

  70. 2023 Grants of Plan-Based Awards

    | | | | | | | | | | All Other | All Other | | | | | | | | | | | | | Stock | Option | Exercise | Grant Date | | | | | | | | | | | Award: | Awards: | or | Fair Value | | | | Date of | Estimated Future Payouts Under | | | Estimated Future | | | Number of | Number of | Base | of Stock | | | | Board or | Non-Equity Incentive Plan | | | Payouts Under Equity | | | Shares of | Securities | Price of | and | | | | Compensation | Awards(2) | | | Incentive Plan Awards | | | Stock or | Underlying | Option | Option | | | Grant | Committee | Threshold | Target | Maximum | Threshold | Target | Maximum | Units | Options | Awards | Awards | | Name | Date | Approval(1) | ($) | ($) | ($) | (#) | (#) | (#) | (#) | (#) | ($/Sh) | ($)(3) | | Steven Chapman | N/A | N/A | 372,329 | 744,658 | 893,589 | — | — | — | — | — | — | — | | | 01/27/2023 | 01/27/2023 | — | — | — | — | — | — | 127,265(4) | — | — | 5,566,571 | | | 01/27/2023 | 01/27/2023 | — | — | — | 38,179(5) | 76,359(5) | 152,718(5) | — | — | — | 3,339,943(6) | | | 01/27/2023 | 01/27/2023 | — | — | — | 25,453(7) | 50,906(7) | 101,812(7) | — | — | — | 2,226,628(6) | | Michael Brophy | N/A | N/A | 115,261 | 230,523 | 276,627 | — | — | — | — | — | — | — | | | 01/27/2023 | 01/27/2023 | — | — | — | — | — | — | 49,664(4) | — | — | 2,172,303 | | | 01/27/2023 | 01/27/2023 | — | — | — | 14,899(5) | 29,798(5) | 59,596(5) | — | — | — | 1,303,365(6) | | | 01/27/2023 | 01/27/2023 | — | — | — | 9,933(7) | 19,866(7) | 39,372(7) | — | — | — | 868,939(6) | | Robert Schueren | N/A | N/A | 66,932 | 133,863 | 160,636 | — | — | — | — | — | — | — | | | 01/27/2023 | 01/27/2023 | — | — | — | — | — | — | 19,865(4) | — | — | 868,895 | | | 01/27/2023 | 01/27/2023 | — | — | — | 5,959(5) | 11,919(5) | 23,838(5) | — | — | — | 521,337(6) | | | 01/27/2023 | 01/27/2023 | | | | 3,973(7) | 7,946(7) | 15,892(7) | — | — | — | 347,558(6) | | Daniel Rabinowitz | N/A | N/A | 91,104 | 182,207 | 218,649 | — | — | — | — | — | — | — | | | 01/27/2023 | 01/27/2023 | — | — | — | — | — | — | 31,040(4) | — | — | 1,357,690 | | | 01/27/2023 | 01/27/2023 | — | — | — | 9,312(5) | 18,624(5) | 37,248(5) | — | — | — | 814,614(6) | | | 01/27/2023 | 01/27/2023 | | | | 6,208(7) | 12,416(7) | 24,832(7) | — | — | — | 543,076(6) | | Matthew Rabinowitz | N/A | N/A | 83,500 | 327,677 | 393,212 | — | — | — | — | — | — | — | | | 01/27/2023 | 01/27/2023 | — | — | — | — | — | — | — | 152,643(8) | 43.74 | 4,099,991 | | | 01/27/2023 | 01/27/2023 | — | — | — | 45,793(9) | 91,586(9) | 183,172(9) | — | — | 43.74 | 2,460,000(10) | | | 01/27/2023 | 01/27/2023 | — | — | — | 30,529(11) | 61,057(11) | 122,114(11) | — | — | 43.74 | 1,639,991(9) |

  71. 2023 Grants of Plan-Based Awards

    | (1) Pursuant to our equity grant policy, as amended, in general equity awards are granted effective as of the next occurring fourth Friday of a calendar month (or, if such date is not a trading day, the first trading day thereafter) following the date of the applicable compensation committee or board of directors meeting or the effective date of a written consent (including e-mail) of our compensation committee or board of directors. |

  72. 2023 Grants of Plan-Based Awards

    | (2) As described in greater detail in “Compensation Discussion and Analysis,” our named executive officers were granted cash incentive bonus opportunities under our 2023 Management Cash Incentive Plan based on achievement during our 2022 fiscal year of company financial performance goals. The amounts shown in the “threshold” column reflect the minimum amount payable if a single goal with the lowest weighting was achieved. The amounts shown in the “target” column reflect the amounts payable if all of the goals were achieved. The amounts shown in the “maximum” column reflect the maximum amount that could be paid, where applicable, for overachievement of the target goal. All amounts shown take into consideration the relative weight of the company financial performance goals, as compared to individual performance, for each executive. |

  73. 2023 Grants of Plan-Based Awards

    On March 1, 2024, our compensation committee confirmed our achievement against the goals, as described in greater detail in “Compensation Discussion and Analysis”.

  74. 2023 Grants of Plan-Based Awards

    | (3) The amounts in this column represent the aggregate grant date fair value of stock awards or option awards granted to the officer in the applicable fiscal year computed in accordance with FASB ASC Topic 718. See Note 9 of the notes to our consolidated financial statements in our Annual Report on Form 10-K filed on February 29, 2024, for a discussion of all assumptions made by us in determining the grant date fair values of our equity awards. |

  75. 2023 Grants of Plan-Based Awards

    In accordance with SEC rules, the grant date fair value of an award subject to a performance condition is based on the probable outcome of the condition. For the performance-based awards reflected in the table, grant date fair value assumes such awards will become eligible to vest at their target level.

  76. 2023 Grants of Plan-Based Awards

    | (4) RSUs vest over four years of service from the grant date, with 25% vesting upon completion of one year of service and the remainder in 12 equal quarterly installments thereafter. |

  77. 2023 Grants of Plan-Based Awards

    | (5) PSUs vest upon our achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2025, subject to continued service through the date of achievement, and as described in further detail in the “Long-Term Incentives” section of “Compensation Discussion and Analysis” beginning on page 52. The number of PSUs reflected in the threshold column reflects achievement of the cumulative annual revenue goal at the threshold level of 95% of target, at which 50% of the target PSUs are eligible to vest. The number of PSUs reflected in the maximum column reflects achievement of the cumulative annual revenue goal at the maximum level of 105% of target, at which 200% of the target PSUs are eligible to vest. |

  78. 2023 Grants of Plan-Based Awards

    | (6) Represents the target level of achievement for the PSUs, which was determined to be the probable level of achievement at the time of grant. The grant date fair value of the award assuming achievement at the maximum level is achieved is set forth in footnote 1 to the Summary Compensation Table beginning on page 59. |

  79. 2023 Grants of Plan-Based Awards

    | (7) PSUs vest upon our achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2024, subject to continued service through the date of achievement, and as described in further detail in the “Long-Term Incentives” section of “Compensation Discussion and Analysis” beginning on page 52. The number of PSUs reflected in the threshold column reflects achievement of the cumulative annual revenue goal at the threshold level of 95% of target, at which 50% of the target PSUs are eligible to vest. The number of PSUs reflected in the maximum column reflects achievement of the cumulative annual revenue goal at the maximum level of 105% of target, at which 200% of the target PSUs are eligible to vest. |

  80. 2023 Grants of Plan-Based Awards

    | (8) Option vests over four years of service from the grant date, with 25% vesting upon completion of one year of service and the remainder in 36 equal monthly installments thereafter. |

  81. 2023 Grants of Plan-Based Awards

    | (9) PSO vests upon our achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2025, subject to continued service through the date of achievement, and as described in further detail in the “Long-Term Incentives” section of “Compensation Discussion and Analysis” beginning on page 52. The number of option shares reflected in the threshold column reflects achievement of the cumulative annual revenue goal at the threshold level of 95% of target, at which 50% of the target option shares are eligible to vest. The number of option shares reflected in the maximum column reflects achievement of the cumulative annual revenue goal at the maximum level of 105% of target, at which 200% of the target option shares are eligible to vest. |

  82. 2023 Grants of Plan-Based Awards

    | (10) Represents the target level of achievement for the PSO, which was determined to be the probable level of achievement at the time of grant. The grant date fair value of the award assuming achievement at the maximum level is set forth in footnote 1 to the Summary Compensation Table beginning on page 59. |

  83. 2023 Grants of Plan-Based Awards

    | (11) PSO vests upon our achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2024, subject to continued service through the date of achievement, and as described in further detail in the “Long-Term Incentives” section of “Compensation Discussion and Analysis” beginning on page 52. The number of option shares reflected in the threshold column reflects achievement of the cumulative annual revenue goal at the threshold level of 95% of target, at which 50% of the target option shares are eligible to vest. The number of option shares reflected in the maximum column reflects achievement of the cumulative annual revenue goal at the maximum level of 105% of target, at which 200% of the target option shares are eligible to vest. |

  84. Outstanding Equity Awards at 2023 Fiscal Year-End

    Outstanding Equity Awards at 2023 Fiscal Year-End The following table provides information regarding each unexercised option and all unvested RSUs held by each of our named executive officers as of December 31, 2023. The number of shares subject to each award and, where applicable, the exercise price per share, reflect all changes as a result of our capitalization adjustments. The vesting schedule applicable to each outstanding award is described in the footnotes to the table below.

  85. Outstanding Equity Awards at 2023 Fiscal Year-End

    | | Option Awards | | | | | Stock Awards | | | | | | | | | | | | | | Equity | | | | | | | | | | | Incentive | | | | | | | | | | Equity | Plan | | | | | | | | | | Incentive | Awards: | | | Equity | | | | | | | Plan | Market or | | | Incentive | | | | | | | Awards: | Payout | | | Plan | | | | | | Market | Number of | Value of | | | Awards: | Number of | Number of | | | Number | Value of | Unearned | Unearned | | | Number of Securities | Securities | Securities | | | of Shares | Shares or | Shares, Units | Shares, | | | Underlying | Underlying | Underlying | | | or Units | Units of | or Other | Units or | | | Unearned, | Unexercised | Unexercised | Option | | of Stock | Stock That | Rights that | Other Rights | | | Unexercised | Options | Options | Exercise | Option | That Have | Have Not | Have Not | that Have | | | Options | (#) | (#) | Price | Expiration | Not Vested | Vested(1) | Vested | Not Vested(1) | | Name | (#) | Exercisable | Unexercisable | ($) | Date | (#) | ($) | (#) | ($) | | Steven Chapman | — | 23,949 | — | 13.01 | 1/10/2029 | — | — | — | — | | | 150,000(2) | — | — | 119.75 | 1/22/2031 | — | — | — | — | | | — | — | — | — | — | 5,184(3) | 324,726 | — | — | | | — | — | — | — | — | 8,873(4) | 555,805 | — | — | | | — | — | — | — | — | 30,474(5) | 1,908,891 | — | — | | | — | — | — | — | — | 127,265(11) | 7,971,880 | — | — | | | — | — | — | — | — | — | — | 75,000(2) | 4,698,000 | | | — | — | — | — | — | — | — | 54,175(6) | 3,393,522 | | | — | — | — | — | — | — | — | 76,359(7) | 4,783,128 | | | — | — | — | — | — | — | — | 50,906(8) | 3,188,752 | | Michael Brophy | — | 10,070 | — | 9.29 | 3/8/2028 | — | — | — | — | | | — | 23,959 | — | 19.68 | 3/21/2029 | — | — | — | — | | | — | — | — | — | — | 2,292(3) | 143,571 | — | — | | | — | — | — | — | — | 5,725(4) | 358,614 | — | — | | | — | — | — | — | — | 10,000(9) | 626,400 | — | — | | | — | — | — | — | — | 13,696(5) | 857,917 | — | — | | | — | — | — | — | — | 49,664(11) | 3,110,953 | — | — | | | — | — | — | — | — | — | — | 25,000(2) | 1,566,000 | | | — | — | — | — | — | — | — | 24,348(6) | 1,525,159 | | | — | — | — | — | — | — | — | 29,798(7) | 1,866,547 | | | — | — | — | — | — | — | — | 19,866(8) | 1,244,406 | | Robert Schueren | — | — | — | — | — | 2,750(3) | 172,260 | — | — | | | — | — | — | — | — | 5,725(4) | 358,614 | — | — | | | — | — | — | — | — | 10,000(7) | 626,400 | — | — | | | — | — | — | — | — | 13,696(5) | 857,917 | — | — | | | — | — | — | — | — | 19,865(10) | 1,244,344 | — | — | | | — | — | — | — | — | — | — | 25,000(2) | 1,566,000 | | | — | — | — | — | — | — | — | 24,348(6) | 1,525,159 | | | — | — | — | — | — | — | — | 11,919(7) | 746,606 | | | — | — | — | — | — | — | — | 7,946(8) | 497,737 | | Daniel Rabinowitz | — | 28,333 | — | 9.29 | 3/8/2028 | — | — | — | — | | | — | 27,500 | — | 10.41 | 6/8/2027 | — | — | — | — | | | — | 42,500 | — | 19.68 | 3/21/2029 | — | — | — | — | | | — | — | — | — | — | 1,364(3) | 85,441 | — | — | | | — | — | — | — | — | 3,220(4) | 201,701 | — | — | | | — | — | — | — | — | 7,704(5) | 482,579 | — | — | | | — | — | — | — | — | 31,040(11) | 1,944,346 | — | — | | | — | — | — | — | — | — | — | 10,000(2) | 626,400 | | | — | — | — | — | — | — | — | 13,696(6) | 857,917 | | | — | — | — | — | — | — | — | 18,624(7) | 1,166,607 | | | — | — | — | — | — | — | — | 12,416(8) | 777,738 | | Matthew Rabinowitz | — | 380,036 | | 2.66 | 2/25/2024 | — | — | — | — | | | — | 613,496 | — | 5.40 | 12/9/2024 | — | — | — | — | | | — | 300,000 | — | 9.59 | 4/7/2026 | — | — | — | — | | | — | 225,000 | — | 10.41 | 6/8/2027 | — | — | — | — | | | — | 200,000 | — | 10.41 | 6/8/2027 | — | — | — | — | | | — | 179,820 | — | 9.29 | 3/8/2028 | — | — | — | — | | | — | 20,180 | — | 10.29 | 4/12/2028 | — | — | — | — | | | — | 600,000 | — | 13.04 | 12/28/2028 | — | — | — | — | | | — | 220,000 | — | 20.27 | 4/11/2029 | — | — | — | — | | | — | 120,468 | 8,032(3) | 25.46 | 3/26/2030 | — | — | — | — | | | — | 128,500 | — | 25.46 | 3/26/2030 | — | — | — | — | | | — | 20,869 | 7,752(10) | 94.14 | 5/27/2031 | — | — | — | — | | | 162,758(2) | — | — | 94.14 | 5/28/2031 | — | — | — | — | | | 110,000(6) | — | — | 65.47 | 1/27/2032 | — | — | — | — | | | — | 52,708 | 57,292(5) | 65.47 | 1/27/2032 | — | — | — | — | | | — | — | 152,643(11) | 43.74 | 1/26/2033 | — | — | — | — | | | 91,586(7) | — | — | 43.74 | 1/26/2033 | — | — | — | — | | | 61,057(8) | — | — | 43.74 | 1/26/2033 | — | — | — | — |

  86. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (1) Market value is based on the fair market value of our common stock at the close of trading on December 29, 2023, the last trading day of fiscal year 2023, which was $62.64. |

  87. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (2) 50% of the award (option or RSUs, as applicable) vests upon our achievement of a market valuation of at least $13 billion within six years of the grant date, subject to continued service through the date of achievement, with an additional 25% vesting upon completion of each |

  88. Outstanding Equity Awards at 2023 Fiscal Year-End

    | of nine and 15 months of continuous service following such achievement, but only if our market valuation remains at or above $13 billion on such nine and 15 month anniversaries of the milestone date (as calculated as described in the applicable award agreement). |

  89. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (3) Award (option or RSUs, as applicable) vests over four years of continuous service following the vesting commencement date of March 27, 2020, with 25% vesting upon completion of 12 months of service and the remainder in 12 substantially equal quarterly installments thereafter. |

  90. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (4) RSUs vest over four years of continuous service following the vesting commencement date of January 21, 2021, with 25% vesting upon completion of 12 months of service and the remainder in 12 substantially equal quarterly installments thereafter. |

  91. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (5) As applicable, option vests over four years of continuous service following the vesting commencement date of January 20, 2022, with 25% vesting upon completion of 12 months of service and the remainder in 36 substantially equal monthly installments thereafter; RSUs vest over four years of continuous service following the vesting commencement date of January 20, 2022, with 25% vesting upon completion of 12 months of service and the remainder in 12 substantially equal quarterly installments thereafter. |

  92. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (6) Award (option or RSUs, as applicable) vests upon the Company’s achievement of a specified annual revenue goal on or prior to the performance period end date of December 31, 2025, subject to continued service through the date of achievement |

  93. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (7) Award (option or RSUs, as applicable) vests upon the Company’s achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2025, subject to continued service through the date of achievement. |

  94. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (8) Award (option or RSUs, as applicable) vests upon the Company’s achievement of a cumulative annual revenue goal on or prior to the performance period end date of December 31, 2024, subject to continued service through the date of achievement. |

  95. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (9) RSUs vest over four years of continuous service following the vesting commencement date of October 22, 2021, with 25% vesting upon completion of 12 months of service and the remainder in 12 substantially equal quarterly installments thereafter. |

  96. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (10) Option vests over four years of continuous service following the vesting commencement date of January 22, 2021, with 25% vesting upon completion of 12 months of service and the remainder in 36 substantially equal monthly installments thereafter. |

  97. Outstanding Equity Awards at 2023 Fiscal Year-End

    | (11) As applicable, option vests over four years of continuous service following the vesting commencement date of January 27, 2023, with 25% vesting upon completion of 12 months of service and the remainder in 36 substantially equal monthly installments thereafter; RSUs vest over four years of continuous service following the vesting commencement date of January 27, 2023, with 25% vesting upon completion of 12 months of service and the remainder in 12 substantially equal quarterly installments thereafter. |

  98. Fiscal 2023 Option Exercises and Stock Vested

    Fiscal 2023 Option Exercises and Stock Vested The following table provides information regarding the number of shares each of our named executive officers acquired upon exercise of stock options and the vesting of RSUs during fiscal 2023.

  99. Fiscal 2023 Option Exercises and Stock Vested

    | | Option Awards | | Stock Awards | | | | Number of | | Number of | | | | shares | Value | shares | Value | | | acquired on | realized on | acquired on | realized on | | | exercise | exercise | vesting | vesting | | Name | (#) | ($)(1) | (#) | ($)(2) | | Steven Chapman | — | — | 95,784 | 4,673,371 | | Michael Brophy | — | — | 52,237 | 2,529,818 | | Robert Schueren | 42,072 | 2,342,127 | 57,173 | 2,726,404 | | Daniel Rabinowitz | — | — | 28,083 | 1,376,614 | | Matthew Rabinowitz | — | — | 2,885 | 162,997 |

  100. Fiscal 2023 Option Exercises and Stock Vested

    | (1) Computed in accordance with Securities and Exchange Commission rules based on the excess of the fair market value of our common stock on the exercise date over the exercise price per share of our common stock multiplied by the number of options exercised and does not necessarily reflect proceeds received by the officer. |

  101. Fiscal 2023 Option Exercises and Stock Vested

    | (2) Computed in accordance with Securities and Exchange Commission rules based on the fair market value of our common stock on the vesting date multiplied by the number of units vested and does not necessarily reflect proceeds received by the officer. |

  102. CEO Pay Ratio

    CEO Pay Ratio The following is a discussion regarding the ratio of the annual total compensation of Mr. Chapman, our CEO and principal executive officer, to our median employee’s annual total compensation, for 2023. We have opted to identify our median employee for 2023 based on our employee population as of October 1, 2023, as described below. The pay ratio reported below is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described below. Because the SEC’s rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices, the pay ratio reported by other companies may not be comparable to the pay ratio reported below, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. Neither our compensation committee nor our management use our pay ratio to make compensation decisions. For purposes of identifying our “median employee,” we used our employee population as of October 1, 2023 (including all employees, whether employed on a full-time, part-time, seasonal or temporary basis). Three employees, located in Canada, were excluded from the calculation under the de minimis exception provided in Item 402(u) of Regulation S-K, resulting in a total of 3,165 U.S. employees. To identify the median employee, we used the following methodology and consistently applied material assumptions, adjustments, and estimates:

  103. CEO Pay Ratio

    | ● | We calculated the 2023 annual total compensation of each employee, excluding Mr. Chapman, as the sum of (1) annual base salary for permanent salaried employees, or hourly rate multiplied by expected annual work schedule for hourly employees; (2) target annual cash incentive compensation, if applicable; and (3) grant date fair value of equity awards granted during the year. |

  104. CEO Pay Ratio

    | ● | In identifying the median employee, we annualized the compensation values of individuals that joined our Company during 2023, through the determination date. |

  105. CEO Pay Ratio

    We calculated the annual total compensation for fiscal 2023 for such employee using the same methodology we used for our NEOs as set forth in the Summary Compensation Table above. For fiscal 2023, the annual total compensation for Mr. Chapman and our median employee was $12,727,887 and $126,030, respectively. Accordingly, the resulting ratio of the two amounts is approximately 101 to 1. We believe the pay ratio is a reasonable estimate calculated in a manner consistent with applicable SEC rules based on our internal payroll and employment records and the methodology described above.

  106. Pay-Versus-Performance

    | (2) In accordance with SEC rules, the following adjustments were made to determine the compensation actually paid to our PEO during fiscal years 2023, 2022, 2021, and 2020, which consisted solely of adjustments to the PEO’s equity awards: |

  107. Pay-Versus-Performance

    | (4) In accordance with SEC rules, the following adjustments were made to determine the compensation actually paid on average to our non-PEO NEOs during fiscal years 2023, 2023, 2021, and 2020, which consisted solely of adjustments to the non-PEO NEOs’ equity awards: |

  108. Compensation Actually Paid and Total Stockholder Return

    Compensation Actually Paid and Total Stockholder Return The following graph illustrates the relationship between the PEO and average non-PEO NEO “compensation actually paid” (CAP), total compensation from the Summary Compensation Table (SCT), our cumulative Total Stockholder Return (TSR,) and the TSR of the NASDAQ Biotechnology Index, assuming an initial fixed investment of $100, for the fiscal years ended December 31, 2023, 2022, 2021, and 2020. The SCT total compensation of our PEO and the average SCT total compensation of our non-PEO NEOs, each as disclosed in the table above, are included in the following graph as supplemental disclosures for each of the periods presented. As detailed in the table above, the CAP calculations include equity adjustments that reflect equity granted over a span of seven years of service prior to, as well as during, the reported fiscal years. A significant portion of our NEOs’ compensation consists of equity awards. As a result, the change between the values disclosed in our SCT and CAP tends to be directionally aligned with changes in our TSR. Our five-year TSR for the fiscal years 2019 through 2023 is 348.7%.

  109. Compensation Actually Paid and Net Income

    Compensation Actually Paid and Net Income The following graph reflects the relationship between the PEO and average non-PEO NEO CAP and our net income (loss) for the fiscal years ended December 31, 2023, 2022, 2021, and 2020. As detailed in the table above, the CAP calculations include equity adjustments that reflect equity granted over a span of seven years of service prior to, as well as during, the reported fiscal years. While we are required by SEC rules to disclose the relationship between our net income and CAP to our NEOs, our company strategy has historically focused on prioritizing rapid revenue growth and investments to support future profitability. As a result, net income is historically not a metric our compensation committee uses in evaluating our NEOs’ compensation. Progressing towards profitability and future net income generation is, however, a key objective as we continue to mature as a company; for example, in 2022 we set a corporate goal to reach cash flow breakeven in a quarter by the end of 2024, and in February 2024 reiterated our intent and timeline with respect to that goal.

  110. Compensation Actually Paid and Total Revenue

    Compensation Actually Paid and Total Revenue The following graph reflects the relationship between the PEO and average non-PEO NEO CAP and our total revenue for the fiscal years ended December 31, 2023, 2022, 2021 and 2020. As detailed in the table above, the CAP calculations include equity adjustments that reflect equity granted over a span of seven years of service prior to, as well as during, the reported fiscal years. Our compensation committee views our revenue as an important metric by which to evaluate and measure our performance, and therefore executive performance. As such, total revenue is one of three company financial metrics under our annual cash incentive program, and is weighted the highest of the three, at 55%. In addition, our compensation committee primarily utilizes annual revenue as the performance milestone for performance-based awards under our long-term incentive plan.